Part VII. Revenues and their Sources

Chapter 48. The Trinity Formula

Capital — profit (profit of enterprise plus interest),
land — ground-rent, labour — wages, this is the trinity formula
which comprises all the secrets of the social production process.

Furthermore, since as previously [Present edition: Ch. XXIII. —
Ed.] demonstrated interest appears as the specific characteristic
product of capital and profit of enterprise on the contrary appears as wages
independent of capital, the above trinity formula reduces itself more
specifically to the following:

Capital — interest, land — ground-rent, labour — wages,
where profit, the specific characteristic form of surplus-value belonging to
the capitalist mode of production, is fortunately eliminated.

On closer examination of this economic trinity, we find the following:

First, the alleged sources of the annually available wealth belong to widely
dissimilar spheres and are not at all analogous with one another. They have
about the same relation to each other as lawyer’s fees, red beets and
music.

Capital, land, labour! However, capital is not a thing, but rather a
definite social production relation, belonging to a definite historical
formation of society, which is manifested in a thing and lends this thing a
specific social character. Capital is not the sum of the material and produced
means of production. Capital is rather the means of production transformed into
capital, which in themselves are no more capital than gold or silver in itself
is money. It is the means of production monopolised by a certain section of
society, confronting living labour-power as products and working conditions
rendered independent of this very labour-power, which are personified through
this antithesis in capital. It is not merely the products of labourers turned
into independent powers, products as rulers and buyers of their producers, but
rather also the social forces and the future [? illegible] [A later collation
with the manuscript showed that the text reads as follows: "die
Gesellschaftlichen Kräfte und Zusammenhängende Form dieser Arbeit" (the social
forces of their labour and socialised form of this labour). —
Ed.] form of this labour, which confront the labourers as properties
of their products. Here, then, we have a definite and, at first glance, very
mystical, social form, of one of the factors in a historically produced social
production process.

And now alongside of this we have the land, inorganic nature as such,
rudis indigestaque moles, ["A rude and undigested mass", Ovid,
Metamorphoses, Book I, 7. — Ed] in all its primeval
wildness. Value is labour. Therefore surplus-value cannot be earth. Absolute
fertility of the soil effects nothing more than the following: a certain
quantity of labour produces a certain product — in accordance with the
natural fertility of the soil. The difference in soil fertility causes the same
quantities of labour and capital, hence the same value, to be manifested in
different quantities of agricultural products; that is, causes these products
to have different individual values. The equalisation of these individual
values into market-values is responsible for the fact that the

"advantages of fertile over inferior soil ... are transferred from the
cultivator or consumer to the landlord". (Ricardo, Principles, London,
1821, p.62.)

And finally, as third party in this union, a mere ghost — "the"
Labour, which is no more than an abstraction and taken by itself does not exist
at all, or, if we take... [illegible] [As has been established by later reading
of the manuscript, it reads here: "wenn wir das Gemeinte nehmen" (if we take
that which is behind it). — Ed.], the productive activity of
human beings in general, by which they promote the interchange with Nature,
divested not only of every social form and well-defined character, but even in
its bare natural existence, independent of society, removed from all societies,
and as an expression and confirmation of life which the still non-social man in
general has in common with the one who is in any way social.

II

Capital — interest; landed property, private ownership of
the Earth, and, to be sure, modern and corresponding to the capitalist mode of
production — rent; wage-labour — wages. The connection between the
sources of revenue is supposed to be represented in this form. Wage-labour and
landed property, like capital, are historically determined social forms; one of
labour, the other of monopolised terrestrial globe, and indeed both forms
corresponding to capital and belonging to the same economic formation of
society.

The first striking thing about this formula is that side by side with
capital, with this form of an element of production belonging to a definite
mode of production, to a definite historical form of social process of
production, side by side with an element of production amalgamated with and
represented by a definite social form are indiscriminately placed: the land on
the one hand and labour on the other, two elements of the real labour process,
which in this material form are common to all modes of production, which are
the material elements of every process of production and have nothing to do
with its social form.

Secondly. In the formula: capital — interest, land —
ground-rent, labour — wages, capital, land and labour appear respectively
as sources of interest (instead of profit), ground-rent and wages, as their
products, or fruits; the former are the basis, the latter the consequence, the
former are the cause, the latter the effect; and indeed, in such a manner that
each individual source is related to its product as to that which is ejected
and produced by it. All the proceeds, interest (instead of profit), rent, and
wages, are three components of the value of the products, i.e., generally
speaking, components of value or expressed in money, certain money components,
price components. The formula: capital — interest is now indeed the most
meaningless formula of capital, but still one of its formulas. But how should
land create value, i.e., a socially defined quantity of labour, and moreover
that particular portion of the value of its own products which forms the rent?
Land, e.g., takes part as an agent of production in creating a use-value, a
material product, wheat. But it has nothing to do with the production of the
value of wheat. In so far as value is represented by wheat, the latter
is merely considered as a definite quantity of materialised social labour,
regardless of the particular substance in which this labour is manifested or of
the particular use-value of this substance. This nowise contradicts that 1)
other circumstances being equal, the cheapness or dearness of wheat depends
upon the productivity of the soil. The productivity of agricultural labour is
dependent on natural conditions, and the same quantity of labour is represented
by more or fewer products, use-values, in accordance with such productivity.
How large the quantity of labour represented in one bushel of wheat depends
upon the number of bushels yielded by the same quantity of labour. It depends,
in this case, upon the soil productivity in what quantities of product the
value shall be manifested. But this value is given, independent of this
distribution. Value is represented in use-value; and use-value is a
prerequisite for the creation of value; but it is folly to create an antithesis
by placing a use-value, like land, on one side and on the other side value, and
a particular portion of value at that. 2)... [here the manuscript breaks
off].

III

Vulgar economy actually does no more than interpret, systematise
and defend in doctrinaire fashion the conceptions of the agents of bourgeois
production who are entrapped in bourgeois production relations. It should not
astonish us, then, that vulgar economy feels particularly at home in the
estranged outward appearances of economic relations in which these prima
facie absurd and perfect contradictions appear and that these relations
seem the more self-evident the more their internal relationships are concealed
from it, although they are understandable to the popular mind. But all science
would be superfluous if the outward appearance and the essence of things
directly coincided. Thus, vulgar economy has not the slightest suspicion that
the trinity which it takes as its point of departure, namely, land —
rent, capital — interest, labour — wages or the price of labour,
are prima facie three impossible combinations. First we have the
use-value land, which has no value, and the exchange-value
rent: so that a social relation conceived as a thing is made
proportional to Nature, i.e., two incommensurable magnitudes are supposed to
stand in a given ratio to one another. Then capital — interest.
If capital is conceived as a certain sum of values represented independently by
money, then it is prima facie nonsense to say that a certain value
should be worth more than it is worth. It is precisely in the form: capital
— interest that all intermediate links are eliminated, and capital is
reduced to its most general formula, which therefore in itself is also
inexplicable and absurd. The vulgar economist prefers the formula capital
— interest, with its occult quality of making a value unequal to itself,
to the formula capital — profit, precisely for the reason that this
already more nearly approaches actual capitalist relations. Then again, driven
by the disturbing thought that 4 is not 5 and that 100 taler cannot possibly be
110 taler, he flees from capital as value to the material substance of capital;
to its use-value as a condition of production of labour, to machinery, raw
materials, etc. Thus, he is able once more to substitute in place of the first
incomprehensible relation, whereby 4 = 5, a wholly incommensurable one between
a use-value, a thing on one side, and a definite social production relation,
surplus-value, on the other, as in the case of landed property. As soon as the
vulgar economist arrives at this incommensurable relation, everything becomes
clear to him, and he no longer feels the need for further thought. For he has
arrived precisely at the "rational" in bourgeois conception. Finally,
labour — wages, or price of labour, is an expression, as shown
in Book I, which prima facie contradicts the conception of value as
well as of price — the latter generally being but a definite expression
of value. And "price of labour" is just as irrational as a yellow logarithm.
But here the vulgar economist is all the more satisfied, because he has gained
the profound insight of the bourgeois, namely, that he pays money for labour,
and since precisely the contradiction between the formula and the conception of
value relieves him from all obligation to understand the latter.

We [49] have seen
that the capitalist process of production is a historically determined form of
the social process of production in general. The latter is as much a production
process of material conditions of human life as a process taking place under
specific historical and economic production relations, producing and
reproducing these production relations themselves, and thereby also the bearers
of this process, their material conditions of existence and their mutual
relations, i.e., their particular socio-economic form. For the aggregate of
these relations, in which the agents of this production stand with respect to
Nature and to one another, and in which they produce, is precisely society,
considered from the standpoint of its economic structure. Like all its
predecessors, the capitalist process of production proceeds under definite
material conditions, which are, however, simultaneously the bearers of definite
social relations entered into by individuals in the process of reproducing
their life. Those conditions, like these relations, are on the one hand
prerequisites, on the other hand results and creations of the capitalist
process of production; they are produced and reproduced by it. We saw also that
capital — and the capitalist is merely capital personified and functions
in the process of production solely as the agent of capital — in its
corresponding social process of production, pumps a definite quantity of
surplus-labour out of the direct producers, or labourers; capital obtains this
surplus-labour without an equivalent, and in essence it always remains forced
labour — no matter how much it may seem to result from free contractual
agreement. This surplus-labour appears as surplus-value, and this surplus-value
exists as a surplus-product. Surplus-labour in general, as labour performed
over and above the given requirements, must always remain. In the capitalist as
well as in the slave system, etc., it merely assumes an antagonistic form and
is supplemented by complete idleness of a stratum of society. A definite
quantity of surplus-labour is required as insurance against accidents, and by
the necessary and progressive expansion of the process of reproduction in
keeping with the development of the needs and the growth of population, which
is called accumulation from the viewpoint of the capitalist. It is one of the
civilising aspects of capital that it enforces this surplus-labour in a manner
and under conditions which are more advantageous to the development of the
productive forces, social relations, and the creation of the elements for a new
and higher form than under the preceding forms of slavery, serfdom, etc. Thus
it gives rise to a stage, on the one hand, in which coercion and monopolisation
of social development (including its material and intellectual advantages) by
one portion of society at the expense of the other are eliminated; on the other
hand, it creates the material means and embryonic conditions, making it
possible in a higher form of society to combine this surplus-labour with a
greater reduction of time devoted to material labour in general. For, depending
on the development of labour productivity, surplus-labour may be large in a
small total working-day, and relatively small in a large total working-day. If
the necessary labour-time = 3 and the surplus-labour = 3, then the total
working-day = 6 and the rate of surplus-labour = 100%. If the necessary labour
= 9 and the surplus-labour = 3, then the total working-day = 12 and the rate of
surplus-labour only = 33⅓%. In that case, it depends
upon the labour productivity how much use-value shall be produced in a definite
time, hence also in a definite surplus labour-time. The actual wealth of
society, and the possibility of constantly expanding its reproduction process,
therefore, do not depend upon the duration of surplus-labour, but upon its
productivity and the more or less copious conditions of production under which
it is performed. In fact, the realm of freedom actually begins only where
labour which is determined by necessity and mundane considerations ceases; thus
in the very nature of things it lies beyond the sphere of actual material
production. Just as the savage must wrestle with Nature to satisfy his wants,
to maintain and reproduce life, so must civilised man, and he must do so in all
social formations and under all possible modes of production. With his
development this realm of physical necessity expands as a result of his wants;
but, at the same time, the forces of production which satisfy these wants also
increase. Freedom in this field can only consist in socialised man, the
associated producers, rationally regulating their interchange with Nature,
bringing it under their common control, instead of being ruled by it as by the
blind forces of Nature; and achieving this with the least expenditure of energy
and under conditions most favourable to, and worthy of, their human nature. But
it nonetheless still remains a realm of necessity. Beyond it begins that
development of human energy which is an end in itself, the true realm of
freedom, which, however, can blossom forth only with this realm of necessity as
its basis. The shortening of the working-day is its basic prerequisite.

In a capitalist society, this surplus-value, or this surplus-product
(leaving aside chance fluctuations in its distribution and considering only its
regulating law, its standardising limits), is divided among capitalists as
dividends proportionate to the share of the social capital each holds. In this
form surplus-value appears as average profit which falls to the share of
capital, an average profit which in turn divides into profit of enterprise and
interest, and which under these two categories may fall into the laps of
different kinds of capitalists. This appropriation and distribution of
surplus-value, or surplus-product, on the part of capital, however, has its
barrier in landed property. Just as the operating capitalist pumps
surplus-labour, and thereby surplus value and surplus-product in the form of
profit, out of the labourer, so the landlord in turn pumps a portion of this
surplus-value, or surplus-product, out of the capitalist in the form of rent in
accordance with the laws already elaborated.

Hence, when speaking here of profit as that portion of surplus-value falling
to the share of capital, we mean average profit (equal to profit of enterprise
plus interest) which is already limited by the deduction of rent from the
aggregate profit (identical in mass with aggregate surplus-value); the
deduction of rent is assumed. Profit of capital (profit of enterprise plus
interest) and ground-rent are thus no more than particular components of
surplus-value, categories by which surplus-value is differentiated depending on
whether it falls to the share of capital or landed property, headings which in
no whit however alter its nature. Added together, these form the sum of social
surplus-value. Capital pumps the surplus-labour, which is represented by
surplus-value and surplus-product, directly out of the labourers. Thus, in this
sense, it may be regarded as the producer of surplus-value. Landed property has
nothing to do with the actual process of production. Its role is confined to
transferring a portion of the produced surplus-value from the pockets of
capital to its own. However, the landlord plays a role in the capitalist
process of production not merely through the pressure he exerts upon capital,
nor merely because large landed property is a prerequisite and condition of
capitalist production since it is a prerequisite and condition of the
expropriation of the labourer from the means of production, but particularly
because he appears as the personification of one of the most essential
conditions of production.

Finally, the labourer in the capacity of owner and seller of his individual
labour-power receives a portion of the product under the label of wages, in
which that portion of his labour appears which we call necessary labour, i.e.,
that required for the maintenance and reproduction of this labour-power, be the
conditions of this maintenance and reproduction scanty or bountiful, favourable
or unfavourable.

Whatever may be the disparity of these relations in other respects, they all
have this in common: Capital yields a profit year after year to the capitalist,
land a ground-rent to the landlord, and labour-power, under normal conditions
and so long as it remains useful labour-power, a wage to the labourer. These
three portions of total value annually produced, and the corresponding portions
of the annually created total product (leaving aside for the present any
consideration of accumulation), may be annually consumed by their respective
owners, without exhausting the source of their reproduction. They are like the
annually consumable fruits of a perennial tree, or rather three trees; they
form the annual incomes of three classes, capitalist, landowner and labourer,
revenues distributed by the functioning capitalist in his capacity as direct
extorter of surplus-labour and employer of labour in general. Thus, capital
appears to the capitalist, land to the landlord, and labour-power, or rather
labour itself, to the labourer (since he actually sells labour-power only as it
is manifested, and since the price of labour-power, as previously shown,
inevitably appears as the price of labour under the capitalist mode of
production), as three different sources of their specific revenues, namely,
profit, ground-rent and wages. They are really so in the sense that capital is
a perennial pumping-machine of surplus-labour for the capitalist, land a
perennial magnet for the landlord, attracting a portion of the surplus-value
pumped out by capital, and finally, labour the constantly self-renewing
condition and ever self-renewing means of acquiring under the title of wages a
portion of the value created by the labourer and thus a part of the social
product measured by this portion of value, i.e., the necessities of life. They
are so, furthermore, in the sense that capital fixes a portion of the value and
thereby of the product of the annual labour in the form of profit; landed
property fixes another portion in the form of rent; and wage-labour fixes a
third portion in the form of wages, and precisely by this transformation
converts them into revenues of the capitalist, landowner, and labourer,
without, however, creating the substance itself which is transformed into these
various categories. The distribution rather presupposes the existence of this
substance, namely, the total value of the annual product, which is nothing but
materialised social labour. Nevertheless, it is not in this form that the
matter appears to the agents of production, the bearers of the various
functions in the production process, but rather in a distorted form. Why this
takes place will be developed in the further course of our analysis. Capital
landed property and labour appear to those agents of production as three
different, independent sources, from which as such there arise three different
components of the annually produced value — and thereby the product in
which it exists; thus, from which there arise not merely the different forms of
this value as revenues falling to the share of particular factors in the social
process of production, but from which this value itself arises, and thereby the
substance of these forms of revenue.

[Here one folio sheet of the manuscript is missing.]

... Differential rent is bound up with the relative soil fertility, in other
words, with properties arising from the soil as such. But, in the first place,
in so far as it is based upon the different individual values of the products
of different soil types, it is but the determination just mentioned; secondly,
in so far as it is based upon the regulating general market-value, which
differs from these individual values, it is a social law carried through by
means of competition, which has to do neither with the soil nor the different
degrees of its fertility.

It might seem as if a rational relation were expressed at least in "labour
— wages." But this is no more the case than with "land —
ground-rent." In so far as labour is value-creating, and is manifested in the
value of commodities, it has nothing to do with the distribution of this value
among various categories. In so far as it has the specifically social character
of wage-labour, it is not value-creating. It has already been shown in general
that wages of labour, or price of labour, is but an irrational expression for
the value, or price of labour-power; and the specific social conditions, under
which this labour-power is sold, have nothing to do with labour as a general
agent in production. Labour is also materialised in that value component of a
commodity which as wages forms the price of labour-power; it creates this
portion just as much as the other portions of the product; but it is
materialised in this portion no more and no differently than in the portions
forming rent or profit. And, in general, when we establish labour as
value-creating, we do not consider it in its concrete form as a condition of
production, but in its social delimitation which differs from that of
wage-labour.

Even the expression "capital — profit" is incorrect here. If capital
is viewed in the only relation in which it produces surplus-value, namely, its
relation to the labourer whereby it extorts surplus-labour by compulsion
exerted upon labour-power, i.e., the wage-labourer, then this surplus-value
comprises, outside of profit (profit of enterprise plus interest), also rent,
in short the entire undivided surplus-value. Here, on the other hand, as a
source of revenue, it is placed only in relation to that portion falling to the
share of the capitalist. This is not the surplus-value which it extracts
generally but only that portion which it extracts for the capitalist. Still
more does all connection vanish no sooner the formula is transformed into
"capital — interest."

If we at first considered the disparity of the above three sources, we now
note that their products, their offshoots, or revenues, on the other band, all
belong to the same sphere, that of value. However, this is compensated for
(this relation not only between incommensurable magnitudes, but also between
wholly unlike, mutually unrelated, and non-comparable things) in that capital,
like land and labour, is simply considered as a material substance, that is,
simply as a produced means of production, and thus is abstracted both as a
relation to the labourer and as value.

Thirdly, if understood in this way, the formula, capital — interest
(profit), land — rent, labour — wages, presents a uniform and
symmetrical incongruity. In fact, since wage-labour does not appear as a
socially determined form of labour, but rather all labour appears by its nature
as wage-labour (thus appearing to those in the grip of capitalist production
relations), the definite specific social forms assumed by the material
conditions of labour — the produced means of production and the land
— with respect to wage-labour (just as they, in turn, conversely
presuppose wage-labour), directly coincide with the material existence of these
conditions of labour or with the form possessed by them generally in the actual
labour-process, independent of its concrete historically determined social
form, or indeed independent of any social form. The changed form of
the conditions of labour, i. e., alienated from labour and confronting it
independently, whereby the produced means of production are thus transformed
into capital, and the land into monopolised land, or landed property —
this form belonging to a definite historical period thereby coincides with the
existence and function of the produced means of production and of the land in
the process of production in general. These means of production are in
themselves capital by nature; capital is merely an "economic appellation" for
these means of production; and so, in itself land is by nature the earth
monopolised by a certain number of landowners. Just as products confront the
producer as an independent force in capital and capitalists — who
actually are but the personification of capital — so land becomes
personified in the landlord and likewise gets on its hind legs to demand, as an
independent force, its share of the product created with its help. Thus, not
the land receives its due portion of the product for the restoration and
improvement of its productivity, but instead the landlord takes a share of this
product to chaffer away or squander. It is clear that capital presupposes
labour as wage-labour. But it is just as clear that if labour as wage-labour is
taken as the point of departure, so that the identity of labour in general with
wage-labour appears to be self-evident, then capital and monopolised land must
also appear as the natural form of the conditions of labour in relation to
labour in general. To be capital, then, appears as the natural form of the
means of labour and thereby as the purely real character arising from their
function in the labour-process in general. Capital and produced means of
production thus become identical terms. Similarly, land and land monopolised
through private ownership become identical. The means of labour as such, which
are by nature capital, thus become the source of profit, much as the land as
such becomes the source of rent.

Labour as such, in its simple capacity as purposive productive activity,
relates to the means of production, not in their social determinate form, but
rather in their concrete substance, as material and means of labour; the latter
likewise are distinguished from one another merely materially, as use-values,
i.e., the land as unproduced, the others as produced, means of labour. If,
then, labour coincides with wage-labour, so does the particular social form in
which the conditions of labour confront labour coincide with their material
existence. The means of labour as such are then capital, and the land as such
is landed property. The formal independence of these conditions of labour in
relation to labour, the unique form of this independence with respect to
wage-labour, is then a property inseparable from them as things, as material
conditions of production, an inherent, immanent, intrinsic character of them as
elements of production. Their definite social character in the process of
capitalist production bearing the stamp of a definite historical epoch is a
natural, and intrinsic substantive character belonging to them, as it were,
from time immemorial, as elements of the production process. Therefore, the
respective part played by the earth as the original field of activity of
labour, as the realm of forces of Nature, as the pre-existing arsenal of all
objects of labour, and the other respective part played by the produced means
of production (instruments, raw materials, etc.) in the general process of
production, must seem to be expressed in the respective shares claimed by them
as capital and landed property, i.e., which fall to the share of their social
representatives in the form of profit (interest) and rent, like to the labourer
— the part his labour plays in the process of production is expressed in
wages. Rent, profit and wages thus seem to grow out of the role played by the
land, produced means of production, and labour in the simple labour-process,
even when we consider this labour-process as one carried on merely between man
and Nature, leaving aside any historical determination. It is merely the same
thing again, in another form, when it is argued: the product in which a
wage-labourer’s labour for himself is manifested, his proceeds or
revenue, is simply wages, the portion of value (and thereby the social product
measured by this value) which his wages represent. Thus, if wage-labour
coincides with labour generally, then so do wages with the produce of labour,
and the value portion representing wages with the value created by labour
generally. But in this way the other portions of value, profit and rent also
appear independent with respect to wages, and must arise from sources of their
own, which are specifically different and independent of labour; they must
arise from the participating elements of production, to the share of whose
owners they fall; i.e., profit arises from the means of production, the
material elements of capital, and rent arises from the land, or Nature, as
represented by the landlord (Roscher). [Roscher, System der
Volkswirtschaft, Band I, Die Grundlagen der Nationalökonomie,
Stuttgart und Augsburg, 1858. — Ed.]

Landed property, capital and wage-labour are thus transformed from sources
of revenue — in the sense that capital attracts to the capitalist, in the
form of profit, a portion of the surplus-value extracted by him from labour,
that monopoly in land attracts for the landlord another portion in the form of
rent; and that labour grants the labourer the remaining portion of value in the
form of wages — from sources by means of which one portion of value is
transformed into the form of profit, another into the form of rent, and a third
into the form of wages — into actual sources from which these value
portions and respective portions of the product in which they exist, or for
which they are exchangeable, arise themselves, and from which, therefore, in
the final analysis, the value of the product itself arises.[50]

In the case of the simplest categories of the capitalist mode of production,
and even of commodity-production, in the case of commodities and money, we have
already pointed out the mystifying character that transforms the social
relations, for which the material elements of wealth serve as bearers in
production, into properties of these things themselves (commodities) and still
more pronouncedly transforms the production relation itself into a thing
(money). All forms of society, in so far as they reach the stage of
commodity-production and money circulation, take part in this perversion. But
under the capitalist mode of production and in the case of capital, which forms
its dominant category, its determining production relation, this enchanted and
perverted world develops still more. If one considers capital, to begin with,
in the actual process of production as a means of extracting surplus-labour,
then this relationship is still very simple, and the actual connection
impresses itself upon the bearers of this process, the capitalists themselves,
and remains in their consciousness. The violent struggle over the limits of the
working-day demonstrates this strikingly. But even within this non-mediated
sphere, the sphere of direct action between labour and capital, matters do not
rest in this simplicity. With the development of relative surplus-value in the
actual specifically capitalist mode of production, whereby the productive
powers of social labour are developed, these productive powers and the social
interrelations of labour in the direct labour-process seem transferred from
labour to capital. Capital thus becomes a very mystic being since all of
labour’s social productive forces appear to be due to capital, rather
than labour as such, and seem to issue from the womb of capital itself. Then
the process of circulation intervenes, with its changes of substance and form,
on which all parts of capital, even agricultural capital, devolve to the same
degree that the specifically capitalist mode of production develops. This is a
sphere where the relations under which value is originally produced are pushed
completely into the background. In the direct process of production the
capitalist already acts simultaneously as producer of commodities and manager
of commodity-production. Hence this process of production appears to him by no
means simply as a process of producing surplus-value. But whatever may be the
surplus-value extorted by capital in the actual production process and
appearing in commodities, the value and surplus-value contained in the
commodities must first be realised in the circulation process. And both the
restitution of the values advanced in production and, particularly, the
surplus-value contained in the commodities seem not merely to be realised in
the circulation, but actually to arise from it; an appearance which is
especially reinforced by two circumstances: first, the profit made in selling
depends on cheating, deceit, inside knowledge, skill and a thousand favourable
market opportunities; and then by the circumstance that added here to
labour-time is a second determining element — time of circulation. This
acts, in fact, only as a negative barrier against the formation of value and
surplus-value, but it has the appearance of being as definite a basis as labour
itself and of introducing a determining element that is independent of labour
and resulting from the nature of capital. In Book II we naturally had to
present this sphere of circulation merely with reference to the form
determinations which it created and to demonstrate the further development of
the structure of capital taking place in this sphere. But in reality this
sphere is the sphere of competition, which, considered in each individual case,
is dominated by chance; where, then, the inner law, which prevails in these
accidents and regulates them, is only visible when these accidents are grouped
together in large numbers, where it remains, therefore, invisible and
unintelligible to the individual agents in production. But furthermore: the
actual process of production, as a unity of the direct production process and
the circulation process, gives rise to new formations, in which the vein of
internal connections is increasingly lost, the production relations are
rendered independent of one another, and the component values become ossified
into forms independent of one another.

The conversion of surplus-value into profit, as we have seen, is determined
as much by the process of circulation as by the process of production.
Surplus-value, in the form of profit, is no longer related back to that portion
of capital invested in labour from which it arises, but to the total capital.
The rate of profit is regulated by laws of its own, which permit, or even
require, it to change while the rate of surplus-value remains unaltered. All
this obscures more and more the true nature of surplus-value and thus the
actual mechanism of capital. Still more is this achieved through the
transformation of profit into average profit and of values into prices of
production, into the regulating averages of market-prices. A complicated social
process intervenes here, the equalisation process of capitals, which divorces
the relative average prices of the commodities from their values, as well as
the average profits in the various spheres of production (quite aside from the
individual investments of capital in each particular sphere of production) from
the actual exploitation of labour by the particular capitals. Not only does it
appear so, but it is true in fact that the average price of commodities differs
from their value, thus from the labour realised in them, and the average profit
of a particular capital differs from the surplus-value which this capital has
extracted from the labourers employed by it. The value of commodities appears,
directly, solely in the influence of fluctuating productivity of labour upon
the rise and fall of the prices of production, upon their movement and not upon
their ultimate limits. Profit seems to be determined only secondarily by direct
exploitation of labour, in so far as the latter permits the capitalist to
realise a profit deviating from the average profit at the regulating
market-prices, which apparently prevail independent of such exploitation.
Normal average profits themselves seem immanent in capital and independent of
exploitation; abnormal exploitation, or even average exploitation under
favourable, exceptional conditions, seems to determine only the deviations from
average profit, not this profit itself. The division of profit into profit of
enterprise and interest (not to mention the intervention of commercial profit
and profit from money-dealing, which are founded upon circulation and appear to
arise completely from it, and not from the process of production itself)
consummates the individualisation of the form of surplus-value, the
ossification of its form as opposed to its substance, its essence. One portion
of profit, as opposed to the other, separates itself entirely from the
relationship of capital as such and appears as arising not out of the function
of exploiting wage-labour, but out of the wage-labour of the capitalist
himself. In contrast thereto, interest then seems to be independent both of the
labourer’s wage-labour and the capitalist’s own labour, and to
arise from capital as its own independent source. If capital originally
appeared on the surface of circulation as a fetishism of capital, as a
value-creating value, so it now appears again in the form of interest-bearing
capital, as in its most estranged and characteristic form. Wherefore also the
formula capital — interest, as the third to land — rent and labour
— wages, is much more consistent than capital — profit, since in
profit there still remains a recollection of its origin, which is not only
extinguished in interest, but is also placed in a form thoroughly antithetical
to this origin.

Finally, capital as an independent source of surplus-value is joined by
landed property, which acts as a barrier to average profit and transfers a
portion of surplus-value to a class that neither works itself, nor directly
exploits labour, nor can find morally edifying rationalisations, as in the case
of interest-bearing capital, e.g., risk and sacrifice of lending capital to
others. Since here a part of the surplus-value seems to be bound up directly
with a natural element, the land, rather than with social relations, the form
of mutual estrangement and ossification of the various parts of surplus-value
is completed, the inner connection completely disrupted, and its source
entirely buried, precisely because the relations of production, which are bound
to the various material elements of the production process, have been rendered
mutually independent.

In capital — profit, or still better capital — interest, land
— rent, labour — wages, in this economic trinity represented as the
connection between the component parts of value and wealth in general and its
sources, we have the complete mystification of the capitalist mode of
production, the conversion of social relations into things, the direct
coalescence of the material production relations with their historical and
social determination. It is an enchanted, perverted, topsy-turvy world, in
which Monsieur le Capital and Madame la Terre do their ghost-walking as social
characters and at the same time directly as mere things. It is the great merit
of classical economy to have destroyed this false appearance and illusion, this
mutual independence and ossification of the various social elements of wealth,
this personification of things and conversion of production relations into
entities, this religion of everyday life. It did so by reducing interest to a
portion of profit, and rent to the surplus above average profit, so that both
of them converge in surplus-value; and by representing the process of
circulation as a mere metamorphosis of forms, and finally reducing value and
surplus-value of commodities to labour in the direct production process.
Nevertheless even the best spokesmen of classical economy remain more or less
in the grip of the world of illusion which their criticism had dissolved, as
cannot be otherwise from a bourgeois standpoint, and thus they all fall more or
less into inconsistencies, half-truths and unsolved contradictions. On the
other hand, it is just as natural for the actual agents of production to feel
completely at home in these estranged and irrational forms of capital —
interest, land — rent, labour — wages, since these are precisely
the forms of illusion in which they move about and find their daily occupation.
It is therefore just as natural that vulgar economy, which is no more than a
didactic, more or less dogmatic, translation of everyday conceptions of the
actual agents of production, and which arranges them in a certain rational
order, should see precisely in this trinity, which is devoid of all inner
connection, the natural and indubitable lofty basis for its shallow
pompousness. This formula simultaneously corresponds to the interests of the
ruling classes by proclaiming the physical necessity and eternal justification
of their sources of revenue and elevating them to a dogma.

In our description of how production relations are converted into entities
and rendered independent in relation to the agents of production, we leave
aside the manner in which the interrelations, due to the world-market, its
conjunctures, movements of market-prices, periods of credit, industrial and
commercial cycles, alternations of prosperity and crisis, appear to them as
overwhelming natural laws that irresistibly enforce their will over them, and
confront them as blind necessity. We leave this aside because the actual
movement of competition belongs beyond our scope, and we need present only the
inner organisation of the capitalist mode of production, in its ideal average,
as it were.

In preceding forms of society this economic mystification arose principally
with respect to money and interest-bearing capital. In the nature of things it
is excluded, in the first place, where production for the use-value, for
immediate personal requirements, predominates; and, secondly, where slavery or
serfdom form the broad foundation of social production, as in antiquity and
during the Middle Ages. Here, the domination of the producers by the conditions
of production is concealed by the relations of dominion and servitude, which
appear and are evident as the direct motive power of the process of production.
In early communal societies in which primitive communism prevailed, and even in
the ancient communal towns, it was this communal society itself with its
conditions which appeared as the basis of production, and its reproduction
appeared as its ultimate purpose. Even in the medieval guild system neither
capital nor labour appear untrammelled, but their relations are rather defined
by the corporate rules, and by the same associated relations, and corresponding
conceptions of professional duty, craftsmanship, etc. Only when the capitalist
mode of production — [The manuscript breaks off here —
Ed.]

Notes

48. The following three fragments were found in
different parts of the manuscript for Part VI. — F. E.

50. Wages, profit, and rent are the three original
sources of all revenue, as well as of all exchangeable value (A. Smith) [An
Inquiry into the Nature and Causes of the Wealth of Nations, Aberdeen,
London, 1848, S. 43. — Ed.] — It is thus that the causes
of material production are at the same time the sources of the original
revenues which exist. (Storch [Cours d’économie politique,
St.-Pétersbourg, 1815. — Ed.], I, p. 259. —
Ed.)